On this week’s weekend show we will have Chuck Provini (CEO and President) and Brien Lundin (Chairman and Director) of Natcore along with Chris Temple discussing the company and solar industry. Tune in on Saturday to hear what they have to say.

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Natcore Technology President’s Message – October 2015

In my last President’s Message, I compared Natcore’s march toward the Ultimate Solar Cell with Lao Tzu’s journey of a thousand miles.

They both began with one step, and they proceed…one step at a time.

I was gratified to receive so many responses. Interestingly, they fell into two groups:

1. “Thanks for explaining how Natcore’s technologies fit together.”
2. “Show me the money!!!”

The second group undoubtedly contained some Natcore shareholders. So revenue will be the subject of this President’s Message.

Natcore will generate revenue from three sources: licensing agreements, royalties and material sales.

The licensing agreement will generate a one-time fee for the right to utilize our technology. Two of our technologies are closest to commercialization: the laser-processed back-contact cell and the black silicon cell. We also anticipate receiving licensing fees from equipment managers who may have to modify or create different equipment to enable manufacturers to utilize and integrate these two technologies.

Our second revenue source would be royalties. We have developed a model whereby the royalty will be calculated according to the benefit received by the manufacturer in using our technology. For example, the back-contact HIT-type cell will show higher efficiencies than traditional cells. In that case, we would receive a percentage of that efficiency gain.

Black silicon, on the other hand, is a cost-reduction technology. From our black silicon licensees, we would receive a percentage of their cost saving.

In both cases, we anticipate that royalty to be somewhere between 10%-20% for every cell that is made.

We would also earn royalties from equipment manufacturers who are selling equipment based on our technology to cell and module facilities. We would expect revenue from each piece of equipment that was sold.

The third revenue source is material sales. To make our back-contact HIT cell, we use a proprietary process to replace silver with an aluminum material that is made to our specifications. This material will be necessary in the manufacturing of the Natcore HIT cell. We would generate a residual income stream from sales of that material.

Similarly, the black silicon process utilizes a liquid catalyst that does the necessary etching and passivation.  This material, too, is made to our specifications and would generate residual revenue from material sales.

Although these royalties would be potentially significant income to Natcore in the aggregate, they represent only a very small additional cost to the cell manufactures so as not to make it an onerous expense compared to the benefit.

Natcore enjoys a unique position in the solar industry today. With many countries eliminating their solar subsidies, the technology clock is ticking very quickly.  Manufacturers must show an absolute increase in efficiency of 0.6% annually or lose market share.  Since many manufacturers have little or no research and development function, our technology is becoming much more noticed and coveted by the industry.

I hope this gives you some insight as to how our economic model is built, particularly the fact that the vast majority of it is residual income and not a one-time sale.

If you have any comments or questions, please give us a call.

Regards,

Chuck Provini, President, CEO & Director